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Committee passes bill extending debt-settlement protections to small businesses

3195043 · May 5, 2025
AI-Generated Content: All content on this page was generated by AI to highlight key points from the meeting. For complete details and context, we recommend watching the full video. so we can fix them.

Summary

The Assembly Banking and Finance Committee voted to pass AB 1166 to apply California's debt-settlement standards to business loans, creating a private right of action and statutory damages for affected small businesses.

The California State Assembly Banking and Finance Committee advanced AB 1166, a bill that would extend existing California debt-settlement protections from consumer loans to certain commercial loans used by small businesses.

Assemblymember Valencia carried the bill in committee; Louis Cadets Peck, executive director of the Responsible Business Lending Coalition, testified in support. Peck described the bill as a targeted reform that does not prohibit debt-settlement services but aligns their incentives with borrowers. “This is a great issue because there is, wide agreement and ready…

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